PROJECT ABSTRACT My long term career objective is to define the mechanisms of liver inflammation in nonalcoholic steatohepatitis (NASH), the most-prevalent chronic liver disease in the United States of America. NASH is characterized by endoplasmic reticulum (ER) stress, which results in activation of the ER stress sensor Inositol Requiring Enzyme-1 alpha (IRE1?), due to the accumulation of toxic lipids within hepatocytes. Macrophage- mediated liver inflammation associated with recruitment of circulating myeloid cells into the liver is also pivotal in NASH. The current proposal links hepatocyte-derived lipid mediators to macrophage-mediated inflammation by proposing that extracellular vesicles (EVs) from lipotoxic hepatocytes recruit macrophages to the liver, resulting in liver injury and inflammation. In preliminary experiments we have observed that lipotoxic hepatocytes (treated with the free fatty acid palmitate) release ceramide-enriched proinflammatory EVs in an IRE1?-dependent manner. Sphingosine 1-phosphate (S1P), derived from ceramide, on these EVs activates its receptor S1P1 on macrophages, which may promote macrophage chemotaxis into the liver. This has led to the central hypothesis that hepatocyte IRE1? regulates PA-induced EV biogenesis, release and lipid cargo (ceramide and ceramide-derived S1P) accumulation, which in turn attracts macrophages into the liver promoting NASH pathogenesis. Therefore, the goals of this proposal are to understand: i) how IRE1? mediates release of ceramide-enriched EVs; ii) how the ceramide-derived lipid mediator, S1P, on PA- stimulated EVs recruits macrophages to the liver; and iii) can lipotoxic EV production and signaling be targeted in vivo to decrease liver inflammation? The proposed experiments will employ complementary in vitro and in vivo models of lipotoxicity and NASH, respectively; and pharmacological, molecular and genetic approaches to address three integrated hypotheses. First we will directly test the hypothesis that palmitate-induced ER stress drives ceramide biosynthesis leading to EV release by a) the IRE1?-activated transcription factor, X-box binding protein-1 (XBP1) upregulation of the ceramide biosynthesis regulating enzyme serine palmitoyltransferase 1 (SPT1), and b) the transfer of ceramide to multivesicular bodies via the ceramide transport protein STARD11. Second we will directly test the hypothesis that S1P on lipotoxic EVs activates macrophage chemotaxis by a) compartmental generation of S1P by sphingosine kinase 2 forming S1P on PA- induced EVs, and b) S1P on EVs activates macrophage chemotaxis via S1P1 receptor. Third we will directly test the hypothesis that interrupting EV release or signaling is salutary in vivo in a NASH mouse model by a) reduction of EV release by IRE1? hepatocyte-specific knockout mice, and b) genetic and pharmacologic inhibition of S1P signaling on macrophages. This R01 grant application by a current K08 awarded early stage investigator will yield mechanistic insights into the processes of macrophage recruitment in NASH, thus identifying potentially druggable targets, e.g., inhibitors of IRE1?, SPT or S1P1 receptor.